How the Affordable Care Act Will Affect Your Business

How the Affordable Care Act Will Affect Your Business
Under the health care bill, small businesses with 50 or fewer full-time equivalent employees qualify to use the Small Business Health Options Program (SHOP) marketplace to obtain employee insurance.

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Whether self-employed or an employer with a sizable staff, the health of your business depends on the health of your employees. 

On March 23, 2010, the Affordable Care Act, which was designed to provide everyone with quality, affordable health insurance, was signed into law. As changes and more information about the bill continue to roll out, you, as a business owner, must stay informed. 

Comparison pays off 

In 2014, an individual mandate will go into effect, requiring everyone to obtain basic health insurance coverage, qualify for an exemption or make a shared responsibility payment when filing a federal tax return. 

On Oct. 1, 2013, the health insurance marketplace, also called the “exchange,” will open, allowing you to compare insurance options. During this process, you’ll be able to compare plans side-by-side to see how premiums, deductibles and out-of-pocket costs stack up. It’s a way to find coverage if you’re currently uninsured or a way to look for other options if you are currently covered. These insurance options will go into effect on Jan. 1, 2014. 

As part of the marketplace application, you’ll learn whether you qualify for lower monthly premiums or lower out-of-pocket costs based on income. You will also learn if you or your children qualify for free or low-cost coverage through the Children’s Health Insurance Program or Medicaid.

Small businesses 

Under the health care bill, small businesses with 50 or fewer full-time equivalent employees qualify to use the Small Business Health Options Program (SHOP) marketplace to obtain employee insurance. 

If you currently provide insurance for your employees, you can keep that coverage. 

The exchange program will allow small businesses to pool their resources to purchase health care plans they normally wouldn’t be able to afford. However, there are a lot of rules and regulations. 

Keep in mind that if you meet certain guidelines, you’ll be required to notify employees of the new health insurance marketplace and provide them with a “Summary of Benefits and Coverage” form that explains what their plan covers and what it costs. 

In many states, at least 70 percent of employees offered coverage must enroll in order for you to buy insurance through the SHOP. The application will help you determine how this rule applies to your state. 

The HealthCare.gov site includes this example when calculating the number of employees enrolled in SHOP with an assumed 70 percent participation rate: 

  • You offer coverage to 14 full-time employees (two have coverage through a spouse’s employer, one is covered by Medicare, one is covered by TRICARE)
  • 10 employees count toward the 70 percent requirement, so at least 7 employees must enroll
  • During the open enrollment period, if you are unable to meet the minimum participation rate you may apply for coverage during an annual enrollment period from Nov. 15, 2013 to Dec. 15, 2013. 

The Small Business Administration has compiled a list of additional issues to investigate if you have less than 25 employees or are an employer with up to 50 employees, including: 

  • A tax credit to offset the cost of insurance
  • Limits on flexible spending account contributions
  • Additional Medicare withholding on wages
  • New Medicare assessment on net investment income
  • A 90-day maximum waiting period
  • Transitional reinsurance program fees
  • Workplace wellness programs
  • Health insurance coverage reporting requirements 

Large businesses 

If you have more than 50 full-time employees, you are considered a large business under the health care law. 

As of 2015, employers with 50 or more employees might be required to make an Employer Shared Responsibility Payment if at least one full-time employee receives lower costs on monthly premiums through the marketplace. 

In most cases, you will not be able to use the SHOP marketplace to offer health insurance to your employees. However, looking ahead to 2016, all SHOPs will be open to employers with up to 100 full-time employees. 

Be prepared 

HealthCare.gov offers the following checklist to ensure you have the necessary information when applying for SHOP:

  • Employee identification number
  • Tax ID
  • Number of employees
  • Date of birth for all employees (and their dependents, if you plan to offer dependent coverage) 

For more information, visit www.healthcare.gov.

What is your biggest concern about the Affordable Care Act and your onsite septic business? Post a comment below.



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